GAME ON: After two years of full funding for the Pentagon, President Trump has essentially declared victory, and is ready to reverse the trend of ever-rising defense budgets. Last month Trump gave the Pentagon a surprise order to slash upcoming defense spending from $733 billion to $700 billion. From the president’s point of view, the last two defense budget hikes have largely solved the military’s woes, which included aircraft unfit to fly, units unprepared to deploy and stressed troops. “We’re rebuilding our military. We just had approved $716 billion. The year before that, we had $700 billion. So, we’re almost completely rebuilding our military with the latest and the greatest,” Trump said while in France over the weekend.

NOT SO FAST: The first shot in the looming battle over next year’s defense budget was fired yesterday by Armed Services Committee Chairman Sen. Jim Inhofe, who suggested that he will oppose Trump’s order to cut planned spending by tens of billions of dollars. The Oklahoma Republican insisted that top line for the Pentagon, overseas wars, and the nuclear arsenal should be at least $733 billion in 2019. That “should be considered a floor, not a ceiling, for funding our troops,” said Inhofe, who will return in January as Senate Armed Services chairman after Republicans held the chamber. Once inflation is factored, that would keep Pentagon funding at current levels with no new growth.

COMMISSION’S ‘CRISIS’ REPORT: Lawmakers now have new ammunition in the fight for a bigger budget. Inhofe was responding to a newly released report, “Providing for the Common Defense,” ordered up by Congress, which paints a grim picture of the Pentagon in crisis. “The U.S. military could suffer unacceptably high casualties and loss of major capital assets in its next conflict. It might struggle to win, or perhaps lose, a war against China or Russia,” the National Defense Strategy Commission writes in one of its key findings.

The commission, co-chaired by Ambassador Eric Edelman and retired Adm. Gary Roughead, was created by Congress in 2017, and mainly tasked with reviewing Trump’s National Defense Strategy. “We are concerned that the NDS too often rests on questionable assumptions and weak analysis, and it leaves unanswered critical questions regarding how the United States will meet the challenges of a more dangerous world,” the report said. It’s the latest in a series of recent reviews covering U.S. defense strategy over the past eight years, all of them bleak.

“In the 2010 report, we concluded that budget cuts and an increasingly complex international environment were leading to a potential train wreck. In 2014, the aftermath of the Budget Control Act, we said that the BCA was a strategic misstep that was disabling the U.S. because it was facing greater challenges around the world. In this report, I think, what we had to wrestle with was the consequences of all those warnings having been ignored,” Edelman said during a podcast this week with Michael Morell, former acting CIA director and a member of the commission.

Rep. Mac Thornberry, who was a leading force behind the past two years of defense budget hikes as House Armed Services chairman, said the commission’s report makes clear that Congress should not let BCA spending caps dictate U.S. strategy. “It also echoes some of my own concerns; that we are falling behind on key capabilities, that Congress is not reliably providing appropriate resources, and that we face difficult choices if we are going to provide the country with the defense it deserves,” the Texas Republican said in a statement.

IS MONEY REALLY THE ANSWER? Both Edelman and Roughead are set to testify before the Senate Armed Services Committee later this month about their findings, which are likely to set the tone of the debate for now. But not everybody is taking them at face value. “Obviously if we’re vastly outspending Russia and China and we’re losing our competitive edge, our problem is not spending,” said Dan Grazier, a fellow at the Project on Government Oversight.

The findings may be used to justify a third year of defense hikes, but the Pentagon should instead complete its ongoing and first-ever full financial audit to see how its money is being spent, argues Grazier. “This report is in the grand tradition of Washington buck-passing. Whenever elected political officials do not want to have to take responsibility for what they anticipate being unpopular political positions, you assign a blue-ribbon task force to do a study and then the blue-ribbon task force comes back with the unpopular policy discussions,” he said.

BULLET POINTS: The Commission report is replete with nightmare scenarios and dire warnings that America’s military advantage has been eroded by years of budget cuts at home and “authoritarian competitors” abroad — especially China and Russia — who are pursuing determined military buildups aimed at neutralizing U.S. strengths. Here are some key conclusions:

• Due to political dysfunction and decisions made by both major political parties — and particularly due to the effects of the Budget Control Act (BCA) of 2011 along with years of failing to enact timely appropriations — America has significantly weakened its own defense.
• The convergence of these trends has created a crisis of national security for the United States — what some leading voices in the U.S. national security community have termed an emergency.
• These trends are undermining deterrence of U.S. adversaries and the confidence of American allies, thus increasing the likelihood of military conflict.
• The U.S. military could suffer unacceptably high casualties and loss of major capital assets in its next conflict. It might struggle to win, or perhaps lose, a war against China or Russia.
• If the United States had to fight Russia in a Baltic contingency or China in a war over Taiwan, Americans could face a decisive military defeat. These two nations possess precision-strike capabilities, integrated air defenses, cruise and ballistic missiles, advanced cyber warfare and anti-satellite capabilities, significant air, and naval forces, and nuclear weapons — a suite of advanced capabilities heretofore possessed only by the United States.
• The United States is particularly at risk of being overwhelmed should its military be forced to fight on two or more fronts simultaneously.

Good Thursday morning and welcome to Jamie McIntyre’s Daily on Defense, compiled by Washington Examiner National Security Senior Writer Jamie McIntyre (@jamiejmcintyre) and National Security Writer Travis J. Tritten (@travis_tritten). Email us here for tips, suggestions, calendar items and anything else. If a friend sent this to you and you’d like to sign up, click here. If signing up doesn’t work, shoot us an email and we’ll add you to our list. And be sure to follow us on Twitter @dailyondefense.

HAPPENING TODAY: Deputy Defense Secretary Pat Shanahan meets with reporters this morning in an off-camera briefing at 11 a.m., and no doubt the looming showdown over defense spending will be one topic for discussion. Shanahan told Defense News earlier this week that the Pentagon was just finishing up the $733 billion budget when it got the $700 billion mandate, and that it’s now working in “parallel” to see what a lower funding level will look like. “No salami slicing. It’s not about sending a memo to the departments: ‘Here’s your [cut], come back in a week.’ That is not how we’ll go around that exercise,” he said.

ALSO, TODAY: President Trump and the first lady will visit the U.S. Marine Barracks in Southeast Washington today to deliver remarks on supporting veterans and military families, according to the White House. The president’s remarks at “8th & I” are scheduled for 1:30 p.m. Later the president meets with Senate Republican leaders in the Oval Office.   

BIG F-35 BUY: Lockheed Martin has been awarded a $22.7 billion contract for 255 F-35 aircraft for both the U.S. and its international partners. Significantly, the contract commits to combine Lots 12, 13 and 14 for international sales. The buy includes 106 F-35s for the U.S. military, 89 F-35s for international partners, 60 F-35s for foreign military sales customers.

“The acquisition approach for Lots 12-14 will deliver significant cost savings and is critical to achieving our joint goal of an $80 million F-35A for aircraft ordered in 2020,” Lockheed Martin in a statement. “This is a smart approach for the taxpayer, the warfighter and for industry.”

“This Undefinitized Contract Action (UCA) enables F-35 production to continue efficiently while the government and industry teams reach contract agreement. We are committed to reducing costs,” said the F-35 Joint Program Office.

Under the contract, the Air Force will get 64 F-35As, the Marines 26 F-35Bs, and the Navy 16 F-35Cs, as part of Lot 12 to be delivered by 2020.

MATTIS AT BORDER: Defense Secretary Jim Mattis gave a pep talk yesterday to U.S. troops deployed to the Texas border to string barbed wire and erect barriers to block a migrant caravan that is hundreds of miles away and seems headed for California. He told them to pay no attention to all pundits who are criticizing the mission as a political stunt.

“There’s all sorts of stuff in the news and that sort of thing,” Mattis said to a small group of troops at Base Camp Donna. “You just concentrate on what your company commander and your battalion commander tell you. If you read all that stuff, you’ll go nuts,” he said.

UNTOLD COSTS: On the flight down to Texas, Mattis told reporters he still has no idea what the deployment of almost 6,000 active duty troops will cost, in part because of the “non-traditional” way the orders came down. “All of the units are tasked with tracking all costs associated. They will compile those costs and send them up,” Mattis said. “It’s the cost of deploying them, it’s the cost of transferring their equipment to the border, it’s fuel costs, it’s all those kinds of costs.”

But Mattis said the exercise is providing good training for the troops. “It’s been interesting to see the feedback, I would say, from the captains, lieutenant colonels and senior NCO’s,” Mattis said. “One of them — the report came into me, they said, we were not anticipating this, we received the warning order, we got the execute order, we had to deploy to a non-traditional mission away from home station.”

But Mattis said the mission to support U.S. Customs and Border protection is not affecting readiness, just the opposite. Again, he cited feedback from a commanding officer. “He said this is actually very good training because they’re rehearsing everything that we do in a real — in a deployment elsewhere in the world.”

WHY THE NAME CHANGE? Mattis was asked why he vetoed the name “Faithful Patriot” for the border support mission. “When the name of the mission first came in, I had given instructions: I do not want to put this mission in some arcane military terms.  If what we’re doing is laying wire, don’t talk about implementing a barrier plan,” Mattis said. “I want to talk to the American people, because this is a highly politically visible issue, and I want you to tell them what we’re doing. I want you to tell them we are operating in support of Customs, or of Border Police. Do not say we’re supporting a federal agency; tell them what we’re doing.”

HOME FOR THE HOLIDAYS: Mattis indicated that the tasks assigned to the military, which currently are limited to putting in obstacles, and providing transportation and housing for border patrol personnel, will soon be complete. “I would anticipate, with what we’ve been asked to do so far, probably within a week to 10 days, we’ll have done what’s needed,” he said.

But Mattis called the border a “dynamic situation” and that there will no doubt be new requests coming in. That means the troops aren’t likely to make it home for the holidays. Mattis offered no apology for that. “We’re a 365-day-a-year military. Rain or shine, light or dark, cold weather or hot weather — we have an all-weather force that’s on duty 24/7,” he said.

Drive around the Pentagon on Thanksgiving Day and look at the number of cars in the parking lot of people who work right through the holidays,” he said. “All I can say to the American people: Welcome to your military. It’s on duty.”

STALL THAT WALL: Meanwhile back on Capitol Hill, newly-emboldened Democrats were doubling down their resistance to spending any more money on the president’s border wall that he originally insisted would be paid for by Mexico. Sen. Chuck Schumer said yesterday that Senate lawmakers should “stick with their agreement” to provide no more than $1.6 billion for a southern border wall in the fiscal year 2019 budget.

The Senate minority leader’s declaration sets up a possible partisan battle in Congress and a fight with President Trump, who has indirectly threatened to withhold his signature from a critical funding bill if it does not include billions of dollars more in border wall funding.

WHAT MELANIA WANTS, MELANIA GETS: Embattled deputy national security adviser Mira Ricardel was forced out of the White House yesterday, one day after first lady Melania Trump publicly called for her to be fired.

“Mira Ricardel will continue to support the President as she departs the White House to transition to a new role within the Administration,” press secretary Sarah Sanders wrote in a statement to pool reporters. “The President is grateful for Ms. Ricardel’s continued service to the American people and her steadfast pursuit of his national security priorities.”

WHO’S NEXT? Two directors of agencies within the Homeland Security Department have emerged in recent conversations with current and former senior DHS officials as the most likely people to succeed Secretary Kirstjen Nielsen if she is terminated by President Trump in coming weeks. Nielsen was seen with Mattis touring the Texas border yesterday.

The names of David Pekoske, the administrator of the Transportation Security Administration, and Kevin McAleenan, the commissioner of U.S. Customs and Border Protection, were the first to be cited by a handful of sources familiar with talks about what to do if Nielsen is forced out after 11 months on the job.

LOSING IN AFGHANISTAN: Every day comes a new report from Afghanistan about a Taliban attack claiming more lives in the war. This week a Taliban assault killed as many of 50 elite commandos in what was previously thought to be the safe province of Jaghori. Today there’s a report that 30 Afghan police have been killed in an overnight attack by the Taliban.

“The Taliban are closer to victory than we are. The Taliban contest or control 61% of Afghan districts. More than 2,200 Americans have been killed in the long conflict. The United States has spent more than $840 billion. This month the Taliban have claimed credit for a major attack at a high-level meeting in Kandahar that killed General Raziq, arguably the most powerful man in Southern Afghanistan,” notes the Foundation for the Defense of Democracies.

Today, the FDD is sponsoring a discussion on the war featuring Jessica Donati, reporter at The Wall Street Journal, and Thomas Joscelyn and Bill Roggio, FDD senior fellows and editors of FDD’s Long War Journal. The event is invitation only, but will be live streamed here: “Losing a War in Afghanistan: Countering the Taliban and Understanding U.S. Policies.”

THE RUNDOWN

Washington Examiner: Nominee for ICE head says he will defend agency’s worth

Reuters: Pence Says Trump To Meet North Korea’s Kim In 2019; Won’t Allow Broken Promises

Reuters: U.S. Carriers Join Up In East Asia For ‘Complex’ Warfare Drills

Bloomberg: Defense Chief Mattis Ramps Up Global Travel as Reassuring Voice

Military Times: Mattis: Troops to stop using the term ‘secure’ at border locations

Breaking Defense: Next HASC Chair Targets Nuke Funding

CNN: Russia Jammed GPS During Major NATO Military Exercise With U.S. Troops

Defense News: Air Force to wrap up electronic warfare study by January

New York Times: A Letter to the Army: Don’t Punish the Man Who Led the Mission That Killed My Son

Task and Purpose: REVEALED: Here Is The Charge Sheet For The Navy SEAL Accused Of War Crimes In Mosul